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And That Makes Two: Construction Begins on Idylwood Walmart

The excavator in the distance, the pick-up trucks, and the port-a-potty can mean only one thing: Here comes the Idylwood Walmart. Last week, a construction trailer showed up on the north end of the 28-acre site near the Gulf Fwy. on Wayside. This week, the heavy equipment started rolling in, chomping on trash trees along the property’s fences and churning up dust to make way for the city’s second store inside the Loop. So far, though, this proposed 185,00 sq. footer doesn’t appear to have attracted the same scorn as its predecessor on Yale St.

Nice tree drawings. They won’t actually get planted. Walmart bulldozed all the trees on Yale St. They were supposed to replace them, so they planted the lost trees on their parking lot. Tree-less streets. Apparently, that’s what a $6,000,000 380 Agreement to make our streets “better” will buy you.

The thing I don’t understand about these inner-city suburban transplant box stores is why the developers can’t do a better job of connecting to the street and maximizing the land usage. To me it seems to be a matter of simple economics to better use the land to it’s maximum profit potential. Why not build parking (at least employee parking) underneath the huge box? This would free up additional land for, be as it may, more pad sites. Why not push the city to build with as small a set back as possible? This again would enable more retail square footage. Why not add a few floors of residential apartments above the retail space? This would add to the bottom line as well, not to mention provide a guaranteed clientele. Someone please think outside the proverbial suburban box.

Spiral, if there aren’t enough trees planted, that’s the City’s fault. It’s not like we are just giving $6 million to WalMart and Ainbinder. They have to spend the money up front and get reimbursed over time.

Ross, the terrible 380, the loss of tree canopy and the loss of sidewalks are absolutely the City’s fault – specifically Mayor Parker’s.

Due to the 380 being entirely one-sided, the City has no recourse to make the trees any better than they are now.

The City has the option to repay it all 15 months after the Walmart opens. If they pay over time, they will have to pay 10% interest. We’ll see which option they choose, but it’s not guaranteed they will pay it over time.

And it’s exactly like we are giving $6M to Ainbinder and Walmart, because that is what we are going to do. Yes, they spent money, but it is on stuff they would have been required to do to build – like connect to the sewer, build sidewalks and plant trees.

Thomas, all the things you mentioned ARE considered and studies, projections, and business models are done. But simply because you can do that does not mean it makes a project more profitable.

For example just to have more square feet of retail does not mean you make more money, it means more $ for construction and may mean more unrented space which means you may have to drop rental rates.
Also, to add residential to a commercial project opens up a whole new can of worms including regulations, maintenance expenses, and financing considerations.

@ Thomas: Setbacks in many locations are kinda stupid, I’d agree, but Wayside probably isn’t one of them. It’s got a traffic problem as it is, and future expansion of the ROW would be very plausible.

Underground parking is extremely expensive and is financially feasible only when the cost of land is commensurate, probably several times higher than land in this location would’ve sold for. Structured parking is a more reasonable alternative, however it is also not fitting with Wal-Mart’s business model. They rely on people from beyond the neighborhood, many miles beyond a reasonable walking distance, to drive there. Drivers are fairly stupid creatures and like to see how to access the parking lot from a distance and that there are empty spaces to accommodate them.

Residential units above the store vastly complicate the deal and would be unwise. A Wal-Mart is a somewhat proprietary box. It is not easy for any store other than a Wal-Mart to take the second-generation space, and would be functionally obsolete for a non-retail user. If/when Wal-Mart is done with it, it’ll probably be substantially modified or torn down altogether to get at the underlying value of the land. Apartments are not as readily thrown away as a big box.

More importantly, the residential market this far to the east is not sufficiently strong to support a tenant base that can afford to live in new mixed-use construction. It’d have to be a deal with subsidy for affordable housing, but that would’ve drawn out design and construction for a much longer time, during which Wal-Mart has their money tied up in land and a store that isn’t open.

To add to commonsense, a parking garage, or underground parking costs a heck of a lot more than flat ground parking, until the land prices exceed that of the structure cost (per space) it’s a waste of money for developers.

A Wal-mart is so unlikely to be re-purposed that when it is, it tends to make the news. This one in McAllen was transformed into a library:http://www.nytimes.com/2012/09/02/us/former-walmart-in-mcallen-is-now-an-airy-public-library.html?_r=0
Understand, this is what makes me uneasy about Wal-mart: as much its eventual departure as its arrival. I guess if snobbery comes into it, I’m a snob for noticing abandoned buildings. I feel the same dismay re the metroplex in my neighborhood, vacant ten years now. Maybe when all Wal-mart’s stores are Supercenters this process will stop.
Interestingly, the one sort of business that could fill a Wal-mart shell would be another Wal-mart-like business but apparently there are agreements preventing that?
But someday, the executives will read new tea leaves, as part of earning their keep, and because major retailers need to be seen making changes all the time, and decide that smaller stores are the future after all. Then maybe they’ll reclaim all their old abandoned Wal-marts, which will likely still be available, and leave empty Supercenters everywhere. Blight must be “efficient,” or it wouldn’t be so prevalent, I guess.

@Thomas – Structured parking costs about 10x surface parking, about $10-$12K per space. At 185,000 Sf this store probably has 300 employees, and probably 100-125 spaces reserved for employee parking. So that’s $1.2 M on structured parking. I would bet that would be almost 10% of the cost of constructing the store – on improvements that don’t generate any income. That’s why they don’t do it. And they probably aren’t “better connected to the street or maximizing the land usage” because they are doing what the city permits (and demands) them to do.

@luciaphile. I’m sorry but you are just wrong. I have sold several former wal-mart or other big box retail buildings that have been repurposed to other uses. Ever been to a Hobby Lobby? An Academy? That’s probably in a repurposed big box. Flooring and carpet stores, furniture stores, gov’t agencies, libraries, gyms and fitness centers, Goodwill/salvation army stores — almost all of these around Houston are in former big box stores. With all due respect to the art professor in the NYT article, these things are reused ALL THE TIME, and it’s not really a new challenge unless the store is in an area that demographically can’t support it — which is probably why it’s dark in the first place.

Txcon, you needn’t be sorry. I am only too happy to be wrong if it means there are no empty Wal-marts! Big box stores change hands pretty routinely but I am surprised to learn that a Hobby Lobby filled a Wal-Mart. It must have been an old one.
The tax office in my county was very pleasantly made out of what was once a Builder’s Square (defunct builder supply). (It was not exactly a big box, though.) The Academy where I have shopped was a Home Depot, which built a new Home Depot directly behind it. The new Home Depot is little more than a covered shed, practically open to the outdoors. It isn’t hard to imagine its being pulled down when its time is done. Where the Academy had formerly been across the road, became a Spec’s. There’s a good view from its tilt walls, or would be.
I have not seen this phenomenon play out with Wal-mart, though, especially in smaller towns.

Conversion into Goodwill and flea markets has a kind of internal logic. Can’t say the idea that school district administrators are overflowing into defunct Wal-marts soothes me all that much, but that’s a personal foible.
I expect before it’s all over a fair number of Wal-marts will house, for a couple hours a week anyway, new-style churches for people who are “broken and hurting.” Other uses might be these feeding sites I’ve been hearing about and even college. An old Wal-mart’s as good a place as any to earn your degree in leadership.
It’s a new day and no worries alright.

OH I LOVE IT-WHY DOES EVERYONE HAVE TO COMPLAIN ABOUT EVERYTHING. NOT LIKE IF YOUR OPINION COUNTS ANYWAY. BE HAPPY. I AM-DONT HAVE TO DRIVE TO 45 AND ALMEDA ANYMORE. BUT I DO HOPE THEY HIRE BETTER CUSTOMER FRIENDLY PEOPLE…………EVEN THOUGH I BELIEVE TRAFFIC IS GOING TO BE A PAIN…..BUT HEY HAPPY————GO WALMART